Aanalyze the information presented in the following general ledger account of Ca

Question

Aanalyze the information presented in the following general ledger account of Caff Corp. which has three departments: Shapping, Forming and Finishing.

Work in Process-Forming (T account)

Sept 1         DR    10250 / CR 50000     Sept 31

31 Materials          4000

31 Labor                8000

31 FOH                  6000

31 Shaping            36000

ADDITIONAL FACTS:

A) 2,000 units were in process at the beginning of the month, 1/2 completed. (Hint: The beginning inventory cost of 10,250 minus the beginning inventory cost transferred in from Shaping equals the cost added in Forming)

B) 9000 units costing 36000 were received from Shaping during the month.

C) 8000 units were transferred to Finishing during the month and the remaining units in the ending work in process in Forming were 1/3 completed

D) Unit costs in Shaping and Forming were the same for March as for the prior month. (Hint: To arrive at the beginning inventory costs transferred in from Shaping, you must firs determine the unit cost in Shaping)

E) The ratio of material, labor and factory overhead costs for Forming in the beginning and ending balances of Work in Process was in the same ratio as the costs incurred in Forming during the current month. (Hint: After you determine the total beginning inventory costs added in Forming, calculate the above mentioned ratio to break the total into materials, labor and factory overhead).

REQUIRED:

1.- Prepare a cost of production summary for March (Hint: First fill in the numbers that you know in a cost of production summary format.    Also, round percentages in two decimal places and dollar total to the nearest whole dollar.

Please, please, please!!! show all calculation since I need them to have points.

Thanks

Explanation / Answer

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Notes:

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Unit Cost in Shaping = 36,000/9,000 = $4 per unit

Caff Corp. Production Summary For the Month of March Cost of work in process, opening: Cost in Shaping (36,000/9,000*2,000 units) 8,000 Cost in Forming: Materials (2,250*22.22%) 500 Labor (2,250*44.44%) 1,500 Overhead (2,250*33.33%) 750 2,250 10,250 Cost of goods received from Shaping 36,000 Cost of production for month: Materials 4,000 Labor 8,000 Overhead 6,000 18,000 Total costs to be accounted for $64,250 Output for the month Finished and transferred to Finishing during month 8,000 Equivalent units of work in process, ending (3,000*1/3) 1,000 Total equivalent production 9,000 Unit cost for the month: Materials ((500+4,000)/9,000) 0.5 Labor ((1000+8,000)/9,000) 1 Overhead ((750+6,000)/9,000) 0.75 Total cost $2.25 Inventory costs: Costs of goods finished and transferred to Finishing
during month Cost in Shaping (8,000*4) 32,000 Cost in Forming (8,000*2.25) 18,000 $50,000 Cost of work in process, ending Cost in Shaping (3,000*4) 12,000 Cost in Forming: Materials (1,000*.50) 500 Labor (1,000*1) 1,000 Overhead (1,000*.75) 750 2,250 14,250 Total production costs accounted for $64,250

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